Be very careful when you enter the world of ULIPs.
Many a times, there will be agents who would try to gulp it down & specially to the most vulnerable investors, who probably fall for “Return on my insurance premium”.
If not from us, do speak to your friends or family, who have bought this and might be still suffering from this investment.
Here is the summary of the video in short:
As ULIP has a lock-in for 5yrs, so you should be paying for all the 5yr premium to make any meaningful return
But, if you do not want to pay the premium for 5yrs, get ready to be really suffocated. This is why:-
- You cannot withdraw the funds until the end of 5yrs. If you paid just 1 yr premium, you need to wait for 4 more years to get the money back.
- Now, if you think you will get your entire money back, you may not, because of the hefty ULIP charges such as discontinuance fees, premium allocation charges, fund management fee & mortality fees.
- When you discontinue paying premiums within 5yrs
a. Your fund value will first be moved to Discontinued Policy fund
b. Insurance Company might pay you only 4% interest per annum & not the market return.
c. They continue to charge 0.5% p.a as Fund Management fee
d. And at the end you need to pay taxes on all the earnings
Forget any appreciation in your portfolio, you not only lose your Insurance cover but you might just lose your capital too.
Do share this with your friends & family to alarm them about ULIPs.
#ULIPs #Insurance #Finance #PersonalFinance #Scam